Money Order Device with Identity Verification and Method

ABSTRACT

A method of conducting a monetary transaction and system for providing and utilizing a money order device is provided. The method and system utilize a vended money order device that is vended during a vending operation. The money order device is then utilized in a merchant transaction operation. The method and system utilize identity verification information that is transmitted to a clearinghouse during at least one of the vending operation and the merchant transaction operation.

This application is a continuation-in-part of U.S. patent applicationSer. No. 10/436,552, filed May 14, 2003, now U.S. Pat. No. 7,280,984,issued Oct. 9, 2007, which is a division of U.S. patent application Ser.No. 09/567,309, filed May 9, 2000, each of which is incorporated byreference in its entirety.

FIELD OF THE INVENTION

The present invention relates generally to the field of electronicmonetary transactions.

BACKGROUND

Electronic financial transactions are commonly facilitated using creditcards, debit cards, stored-value cards and smart cards. Despite thetechnological advancements in electronic commerce, each of these cardshave definite disadvantages. For example, electronic commerce on theInternet is primarily facilitated using credit cards. As a result,individuals without credit cards cannot enjoy the convenience, selectionand competitive pricing made possible by online shopping. Theseindividuals may not have acceptable credit or may simply be concernedabout the security of their financial information on the Internet. Inaddition, many people prefer cash transactions and frequently use moneyorders, cashier's checks, traveler's checks or other secure financialdocuments or instruments. As a result, a large segment of society isessentially excluded from purchasing goods and services via theInternet. In addition, once money orders, cashier's check and traveler'scheck are issued in a particular currency, they cannot easily beconverted to another currency without cashing them for their full value.

One side effect of the boom in Internet commerce is the dramaticincrease in the number of goods shipped via delivery services, such asthe United States Postal Service, United Parcel Service and FederalExpress, among a few. Despite the scope of information available on theInternet, customers are not always exactly sure what they will receivewhen their package arrives. Accordingly, consumers often would prefer topurchase items by cash on delivery (COD). Internet merchants, however,often require payment by credit card or check (with significant delaysin shipment) and do not offer COD as a payment option or make theprocess so complicated as to make it undesirable by the consumer.Merchants disfavor COD because of the delay in receiving payment fromthe delivery service. Yet, COD simplifies the return process, iscustomer friendly and allows the customer to inspect the goods fordamage before payment is made to the merchant.

Unlike credit cards, smart cards can be used in many applications.Despite this flexibility and great technological potential, there islittle or no standardization for smart card systems. Thus, manydifferent non-compatible smart card systems currently exist. The datastorage and multiple application capability of smart cards also providessecurity concerns. For example, the cardholder does not want his or herdoctor to gain access to credit card and bank account information on asmart card that also contains the cardholder's medical history.Similarly, the cardholder does not want his or her bank to gain accessto medical history on a smart card that also contains the cardholder'scredit card and bank account information.

Moreover, smart cards are not completely invulnerable to failure andloss. For example, a smart card is less resistant to damage from wearand tear, heat, mishandling and contaminants, such as water, dirt,detergent, etc., than a credit card, debit card or magnetic stripe basedstored-value card. If the smart card fails, the cardholder typicallywill lose the amount of money stored on the failed smart card.Similarly, stored-value cards have the disadvantage of losing themonetary value of the card if the card is lost, stolen, damaged ordestroyed. Credit cards and debit cards raise other concerns, such asthieves draining bank accounts, running up large credit card chargesand/or identity theft before the theft is discovered.

Accordingly, there is a need for a money card system that is convenient,easy to use, does not require good or any credit, is useable byindividuals having low incomes, is interchangeable with cash, isavailable in many currencies, can be used in COD transactions, and issafer than cash, checks, money orders, cashier's checks, traveler'schecks, ATM cards, credit cards, debit cards, stored-value cards andsmart cards or other forms of monetary exchange generally available tothe public.

BRIEF DESCRIPTION OF THE DRAWINGS

The above and further advantages of the invention may be betterunderstood by referring to the following description in conjunction withthe accompanying drawings in which corresponding numerals in thedifferent figures refer to corresponding parts in which:

FIG. 1 depicts various ways in which a money card in accordance with thepresent invention may be acquired;

FIGS. 2A and 2B depict a typical money card in accordance with thepresent invention;

FIG. 3 depicts a money card activation sequence when the money card ispurchased from a dispensing agent/vendor in accordance with the presentinvention;

FIG. 4 depicts the use of the money card in a merchant transaction inaccordance with the present invention;

FIG. 5 depicts the use of the money card in an online transaction inaccordance with the present invention;

FIG. 6 depicts the use of the money card in a COD transaction inaccordance with the present invention;

FIG. 7 depicts a cardless authentication process in accordance with thepresent invention; and

FIG. 8 depicts another cardless authentication process in accordancewith the present invention.

DETAILED DESCRIPTION

While the making and using of various embodiments of the presentinvention are discussed herein in terms of a money card system, itshould be appreciated that the present invention provides manyapplicable inventive concepts which can be embodied in a wide variety ofspecific contexts. It should be noted that although throughout thedescription reference is made to a “money card,” because this is aparticular well suited article that may be employed as a money orderdevice, unless the context suggests otherwise, the expression should beread and interpreted to also include non-card devices or means that canbe employed or serve as a money order device, as is described more fullyfurther on. The specific embodiments discussed herein are merelyillustrative of specific ways to make and use the invention and does notlimit the scope of the invention.

The present invention provides a money card system, method and apparatusthat is convenient, easy to use, useable by individuals concerned aboutInternet security, useable by individuals having bad or no credit,useable by individuals having low incomes, interchangeable with cash,useable in COD transactions, and is safer than cash, checks, moneyorders, cashier's checks, traveler's checks, ATM cards, credit cards,debit cards, stored-value cards and smart cards. Thus, the presentinvention can be used as a new medium of exchange for online and on sitepurchases, provide indiscriminate online access to all consumers withpurchasing power, create a more secure form of transaction than cash orcredit, fulfill a need for consumers who are unable or unwilling toobtain credit, and facilitate the transfer of funds. The presentinvention, therefore, allows online merchants to reach markets that werepreviously untapped.

The present invention provides customer convenience because the moneycard is prepaid so that the money card can be used as a medium ofexchange immediately upon purchase and activation of the money card. Thecustomer does not have to wait as long as two months to find out that heor she has been accepted or denied credit. The money card is ideal forpeople who do not have the proclivity for filling out credit cardapplications, individuals with unacceptable credit and teenagers who areunable to obtain credit. According to recent reports, it is estimatedthat the teenage population in America have a collective purchasingpower of approximately $270 billion. Also, twenty percent of householdsin the United States do not have a checking account. It follows thathouseholds that do not have checking accounts would not have creditcards either. Moreover, eighty percent of households in the UnitedStates are two paychecks away from subprime.

The present invention does not require the customer to have any creditrating. The present invention is interchangeable with cash and can bedispensed by ATMs in any currency, at the customer's request, instead ofcash or in combination with cash. The present invention does not havethe same operational restrictions as smart cards. For example,individuals who do not own a personal computer would be able to use amoney card to make purchases as many public libraries, colleges, andcyber cafes now provide free use of the Internet.

The present invention is safer than cash or credit cards because ifone's cash is lost or stolen it may never be recovered and credit cardlosses are only protected after the first $50 and are paid by the ownerof the card. The present invention provides greater safety than checks,money orders, cashier's checks, traveler's checks or debit cards becausethere is no endorsement to forge. With debit cards, the customer couldincur losses that could equal his or her entire checking accountbalance. The customer could incur losses greater than his or her accountbalances if the account has no overdraft protection. With the presentinvention, the losses are restricted to the available amount associatedwith the card, provided that the perpetrator knows or guesses thecorrect Personal Identification Number (PIN) or Personal IdentificationCode (PIC). Adding one or more biometric scans, such as fingerprint,voiceprint, thermal image, retina or iris scan information, enhances thesecurity feature of the present invention and protects it from fraud.The terms PIN or PIC may be used to collectively include biometric scansor any other type of user authentication means. Additional security maybe obtained by buying a money card for the exact amount of one's futurepurchase. In this instance, the money card would be used one time onlyand thereby minimize the possibility of someone, other than the owner,from using the money card.

The present invention, therefore, provides a new medium of exchange thatcan be used on the Internet just like a debit card but without the addedrisk of divulging a bank account number or credit history. In addition,merchants benefit from an instant payment system via an immediatetransfer of funds. Moreover, the clearinghouse benefits from the floatimmediately upon payment and activation of the money card.

FIG. 1 depicts various ways in which a money card 100 in accordance withthe present invention may be acquired. The money card 100 may bepurchased from vending agents 102 at retail stores and outlets,convenience stores, check cashing establishments, financialinstitutions, etc. The money card 100 may also be purchased at standalone money card dispensers 104 or Automated Teller Machines (ATMs) 106.Each vending location, such as vending agents 102, dispensers 104 orATMs 106, includes an authentication input device 108. As illustratedwith vending agent 102, the authentication input device 108 can be aperipheral device connected to the main money card unit 110.

The money card 100 is preferably sold for a nominal fee and may haveeither pre-assigned monetary denominations or an assigned monetary valuedetermined by the customer at the time of purchase. The money card 100is activated upon cash payment by sending the money card number and PINor PIC to a clearinghouse 112 via a communications network 114. Thecommunications network 114 may be the Internet, public switchedtelephone network (PSTN), satellite based network or othertelecommunications network. The activation process will be described inmore detail in reference to FIG. 3. The money card 100 can be issued inany currency or be used to conduct a transaction in a different currencythan that of the money card 100 or the account because the conversion isperformed by the clearinghouse 112 using the current exchange rates.

FIGS. 2A and 2B depict a typical money card 100 in accordance with thepresent invention. More specifically, FIG. 2A depicts the front side 202of the money card 100 in which advertising or a customer selected image204 can be printed. FIG. 2B depicts the back side 206 of the money card100 in which the money card number 208, a Universal Products Code (UPC)symbol 210, a magnetic stripe 212, user instructions 214 and legalnotices 216 (such as a disclaimer that advises the customer or user thathe agrees to the terms upon purchase or use of the money card) areprinted. As will be appreciated by those skilled in the art, the exactorientation of the money card number 208, the UPC symbol 210, themagnetic stripe 212, the user instructions 214 and the legal notices 216can be changed from that illustrated in FIG. 2B. As a result, the moneycard 100 may be used by manually entering the money card number 208using a keypad, scanning the UPC symbol 210 using a wand, or by slidingthe magnetic stripe 212 through a card reader. Once the money card 100is activated, the customer selects a PIN using the authentication inputdevice 108 (FIG. 1) and is encrypted and transmitted electronically tothe clearinghouse 112 (FIG. 1) along with the money card number 208 andother pertinent information, such as the economic value of the moneycard 100, country, state, province, city, vendor location, vendor name,control number, date, and time when the money card 100 was purchased.Should the customer choose to have a Personal Identification Code (PIC)or biometric information to personalize and secure his or her money card100, that information will also be entered into the authentication inputdevice 108 (FIG. 1) and then encrypted and transmitted to theclearinghouse 112 (FIG. 1).

As the standards and reliability of smart cards improve, the money card100 could be a smart money card. The present invention could thenaccommodate both standard and smart money cards. Referring back to FIG.2A, a typical smart money card includes a number of spaced apartelectrical contacts 218 on one surface which provide input and outputinterfaces with the microcontroller 220 in the card. The contacts 218may interface with a terminal via ohmic contact, close-coupling,remote-coupling or a combination thereof. The microcontroller 220typically includes a microprocessor, card memory including random accessmemory (RAM), read-only memory (ROM), non-volatile memory, an encryptionmodule, a card reader interface. Other features of the microcontroller220 may include a clock, a random number generator, interrupt control,control logic, a charge pump, power connections, and the like.

The microprocessor may be any suitable central processing unit forexecuting commands and controlling the device. RAM serves as storage forcalculated results and as a stack memory. ROM stores the operatingsystem, fixed data, standard routines, and look-up tables. Non-volatilememory, such as EPROM or EEPROM, serves to store information that mustnot be lost when the card is connected to a power source but that mustalso be alterable to accommodate data specific to individual cards orany changes possible over the card lifetime. This information mightinclude a card identification number, a personal identification number,authorization levels, cash balances, credit limits, etc. The encryptionmodule is an optional hardware module used for performing a variety ofencryption algorithms.

Since the smart money card has no power supply of its own, the systemstartup phase consists of supplying power to the card and performing a“cold” boot to establish communication between the card and terminal.Thereafter, the card and terminal enter an authentication phase wherethe terminal verifies that it is communicating with an authorized card.This usually entails the smart card forwarding its own access code tothe terminal for verification. Following authentication, one or moretransactions are conducted and the card is removed from the terminal,ending the session.

Alternatively, the money card 100 can be made using a paper-likematerial that has the necessary information imprinted on the surface ofthe money card 100 or stored in a magnetic tape embedded within themoney card 100. The money card 100 may also be made of any material thatallows information to be stored on it or within it, such as compactdiscs or holographic discs.

FIG. 3 depicts a money card 100 activation sequence when a customer 302purchases the money card 100 from a dispensing agent/vendor 304 inaccordance with the present invention. The dispensing agent/vendor 304may be a vending agent 102 (FIG. 1), a stand alone money card dispenser104 (FIG. 1) or an ATM 106 (FIG. 1). The customer 302 purchases themoney card 100 by tendering the value to be assigned to the money card100 plus any additional fees and taxes, if any, via payment 306 to thedispensing agent/vendor 304. Payment 306 may be made via a bank account,a credit card, a debit card, another electronic card, currency, or othersources of funds.

The customer 302 then provides the selected authentication 308 to thedispensing agent/vendor 304. As previously described, the selectedauthentication 308 can take many forms. Preferably, the customer 302 isallowed to choose one or more authentication methods from a list ofavailable authentication options. This allows the customer 302 to selectthe authentication method that best suits the intended use of the moneycard 100, addresses the security concerns of the customer 302 andreasonably protects the value of the money card 100. For example, thecustomer 302 might select both a PIN number and a retina scan or otherbiometric scan if the money card 100 was intended to represent a largeamount of money or was intended to be frequently used. Theauthentication method selected will also depend on the capabilities ofthe dispensing device and the availability of those authenticationmethods at merchants. Thus the present invention can be adapted toprovide for newly devised security methods.

Once the customer 302 provides the selected authentication 308 to thedispensing agent/vendor 304, an activation request 310 is transmittedfrom the dispensing agent/vendor 304 to the clearinghouse 112. Theactivation request 310 can be encrypted and sent over a publiccommunications network or be sent over a dedicated secure communicationslink. Once the clearinghouse 112 receives the activation request 310,the data within the activation request 310 will be checked for errorsand potential fraud depending on the method of payment. The informationincluded in the activation request 310 may include the money cardnumber, PIN or PIC, the vendor name, vendor number, vendor location,date and time of purchase, the economic value of the money card,control, invoice, or transaction number, and any other data that theclearinghouse 112 deems necessary to conduct the transaction. Uponsuccessful acceptance of the activation request 310, the clearinghouse112 activates the money card 100 and sends an activation response 314 tothe dispensing agent/vendor 304. The activation response 314 indicatesthat the activation request 310 has been accepted and that the moneycard 100 has been activated. The dispensing agent/vendor 304 thendelivers the money card 100 and a receipt 316 to the customer 302. Thereceipt 316 may contain sufficient information for the customer 302 toaccess the value of the money card 100 without actually having the moneycard 100 present, such as when the money card 100 is lost or stolen oran emergency arises. If, however, there is some problem detected withthe activation request 310, the clearinghouse 112 will notify thedispensing agent/vendor 304 of the problem using the activation response314.

If the dispensing agent/vendor 304 is an ATM, the customer 302 maychoose to withdraw funds, either in the form of cash, a money card 100or a combination of both. Moreover, the customer 302 can insert themoney card 100 into the ATM and transfer funds to or from the money card100 or withdraw funds in the form of cash. The clearinghouse 112 andparticipating banks can charge transaction fees for these varioustransactions.

The ATM cards that are primarily in use today consist of magnetic-stripememory cards that have a single magnetic stripe on one side. Themagnetic stripe contains information regarding the bank, the customer302, and his/her account. To guard against unauthorized access, thecustomer 320 is also given a multi-digit password or PIN (PersonalIdentification Number), which is typically four or more digits. Thecustomer 302 inserts the mag-stripe card into the ATM and enters amulti-digit password or PIN. The PIN authenticates for the ATM that theperson standing at the ATM is the customer 302 who owns the inserted ATMcard (or an authorized person representing the customer 302). The ATMthen gives the person a choice of cash, money card 100 or a combinationthereof. The ATM's programming and hardware may have to be slightlymodified to accommodate the withdrawal of funds in the form of a moneycard 100. Once the customer 302 chooses to receive his or her funds inthe form of a money card 100, the customer's account would be debited,the ATM software would then encode the amount on the magnetic stripe.The ATM would ask the customer 302 for a PIN, PIC or biometric (if theATM is so equipped) and when he or she finishes entering the PIN, PIC orbiometric all the transactional information would be encrypted andtransmitted to the clearinghouse 112. Once the clearinghouse 112receives the information, it would activate the money card 100, informthe ATM that the information has been received and the ATM woulddispense the money card 100 to the customer 302. The present inventionalso allows a customer 302 to add value to an already purchased moneycard 100 using the same process in which the money card 100 wasoriginally purchased. The customer 302 can perform any of thesetransactions in any currency.

FIG. 4 depicts the use of the money card 100 in a merchant transactionin accordance with the present invention. The money card 100 could beused to purchase goods or services 410 at any retailer or merchant 402that accepts money cards or where a PIN can be input into an entry pador terminal. When payment is requested, the customer 302 gives the moneycard 100 to the merchant 402 who will then swipe, scan or enter themoney card number 208 (FIG. 2B) into an entry pad or terminal. Thecustomer 302 would then be prompted for his or her PIN 404. The moneycard number 208 (FIG. 28), PIN and sales amount would be transmitted tothe clearinghouse 112 in a transaction request 406, which is preferablyencrypted or sent over a secure communication link. The clearinghouse112 then verifies and processes the transaction request 406 and eitherapproves or disapproves the transaction via a transaction response 408.If the money card 100 did not have sufficient funds to cover thetransaction amount or there was an error in authentication, the entrypad screen would indicate the balances needed to complete thetransaction or the applicable error message. In the case where the moneycard 100 did not have sufficient funds, the entry pad screen may ask thecustomer 302 the following questions:

-   -   How do you wish to complete this transaction?    -   1. Cash.    -   2. Check.    -   3. Debit card.    -   4. Credit card.    -   5. A new money card.

If the customer 302 chooses Option 5, “A new money card,” the processwould begin again where the customer's new money card (not shown) wouldbe swiped, scanned or entered into an entry pad or terminal. The processwould continue until the amount needed to pay the merchant 402 is met.Then, any credit balance left on the last money card 100 used would beindicated by a prompt on the screen that would say “Credit BalanceRemaining. Would you like to see the amount on the screen? Or would youlike a receipt?” The customer 302 would select one of these options andmerchant 402 will give the goods or services 410, the money card 100 anda receipt 412, containing such information as the credit balance andmoney card number 208 (FIG. 2B), to the customer 302. The clearinghouse112 would release and transfer the funds to the merchant 402 via atransaction reconciliation process 414, thus completing the transaction.

If the customer 302 uses only one money card 100 to pay for his purchaseand its economic value exceeds the sales amount, then the credit balanceon the money card 100 would be indicated by a prompt on the screen thatwould say “Credit Balance Remaining. Would you like to see the amount onthe screen? Or would you like a receipt?” The customer 302 would selectan option and the clearinghouse 112 would release and transfer the fundsto the merchant 402, the credit balance and money card number 208 (FIG.2B) would be either displayed or printed on a receipt 412 and thetransaction would be complete.

FIG. 5 depicts the use of the money card 100 in an online transaction inaccordance with the present invention. The customer 302 would visit anonline merchant 502 to make a purchase and when the payment options aredisplayed, he or she would select “Money Card” 504. The customer 302then submits his or her money card number(s) 208 (FIG. 2B) via amagnetic stripe reader, UPC scanner, or manual entry via communication506. The customer 302 would then enter his or her PIN(s) manually or ifthe computer or terminal is equipped, he would provide his PIC orbiometric information 508. The authentication information 508 would beencrypted and transmitted to the merchant 502, who would attach thesales amount and his control number(s) or identification to theencrypted file and send the entire encrypted transaction request 510 tothe clearinghouse 112. The control number(s) would be atransaction-specific sequence of numbers such as an invoice number orany other means of identification that the merchant 502 or clearinghouse112 deem appropriate. Because the money card number(s) and PIN(s) areencrypted, the merchant 502 would not know the value of the cards andthe customer 302 would be protected from an unscrupulous merchant 502using any remaining credit balance.

When the clearinghouse 112 receives the money card number(s) 208 (FIG.2B) and PIN(s), it would also receive the dollar amount of thetransaction, thus when it releases the funds, it would know how much ofthe funds to release to the merchant 502. Any credit balance remainingto the customer 302 would be indicated in a transaction response 512from the clearinghouse 112. The customer 302 would also be advised thatthe other cards used in the transaction had exhausted their economicvalue and were no longer valid. The customer 302 would be advised toprint the screen containing his money card number and remaining creditbalance in a transaction summary 514. The clearinghouse 112 wouldrelease and transfer the funds to the merchant 502 via a transactionreconciliation process 516, thus completing the transaction. Themerchant 502 will then send the goods 518 to the customer 302 via adelivery service 520, such as the United States Postal Service, UnitedParcel Service, Federal Express, etc. The customer 302 then receives thegoods 518 from the delivery service 520. The customer 302 also receivesa receipt 522 which may be provided by the delivery service 520 or bepacked with the goods 518 by the merchant 502. As will be described inreference to FIG. 7, if the customer 302 should lose the printout whichcontains his or her money card number and credit balance, the customer302 can call the clearinghouse's telephone number, which may be a tollfree number, that appears on the money card 100 or the customer 302 canvisit the clearinghouse's website and get his or her remaining balanceby entering each money card number(s) 208 (FIG. 2B) and correspondingPIN(s).

FIG. 6 depicts the use of the money card 100 in a COD transaction inaccordance with the present invention. Should the customer 302 prefer topay for the goods purchased online upon delivery, he or she would selectthe payment option “Money Card—C.O.D.” 602. The customer 302 would thenenter his money card information and authentication information, whichwould be encrypted and sent to the merchant 502 in messages 604 and 606.The merchant 502 takes messages 604 and 606 and adds the totaltransaction amount and the merchant's control number(s) to make atransaction request 608, which is encrypted and transmitted to theclearinghouse 112. The control number could be an invoice number,transaction number, taxpayer identification number or any other means ofidentification that the merchant 502 and/or clearinghouse 112 deemappropriate. The transaction request 608 may also include a restockingfee or deposit fee which is designed to detract individuals fromordering goods who might not intend to pay for them when they aredelivered. The restocking charge would be charged against the money card100 only in the event the customer 302 refuses the goods 614. Thus therestocking fee is a deposit that would be credited to the customer'saccount upon acceptance of the goods 614. The clearinghouse 112 wouldverify to the merchant 502 the availability of the funds and upon themerchant's request 608, block their usage, including the restocking fee,for a predetermined period. The amount of time that the funds would beblocked from being used by the customer 302 would be specified in thecustomer/merchant C.O.D. agreement terms on the website. Theclearinghouse 112 would not release the funds to the merchant 502 atthis time.

The merchant 502 would ship the goods 614 to the customer 302 via adelivery service 520. The merchant 502 may also send the packagetracking number issued by the delivery service 520 to the clearinghouse112 to be used as additional authentication when the customer 302receives the goods 614 and authorizes payment. Upon receipt of the goods614 by the customer 302, the customer 302 will provide the shipper withthe customer's money card 100 and authentication information 616. Thedelivery service 520 would swipe, scan or enter each money card number208 (FIG. 2B) on a mobile unit. The mobile unit is typically a hand-helddevice that contains a transceiver. Information is relayed through thedelivery service network and ultimately to the clearinghouse 112. Thedelivery persons receive, validate and securely transmit money cardpayments to the merchant from the point of delivery.

After each money card number, the customer 302 would enter thecorresponding PIN(s) on an entry pad or terminal. The information wouldbe encrypted and sent to the clearinghouse 112 in a transaction request618. The clearinghouse 112 will compare the money card number(s) 208(FIG. 2B) and PIN(s) provided by the customer 302 to the merchant 502with those given to the delivery service 520 and when verified, willrelease the funds to the merchant 502 in a transaction reconciliationprocess 624. The clearinghouse 112 would also send an approval in theform of a transaction response 620 to the delivery service 520,indicating the amount approved, and the goods 614 would be released tothe customer 302. If a credit balance amount should exist, the screenwould display the credit balance amount along with the correspondingmoney card number 208 (FIG. 2B) on the shipper's mobile unit. Thedelivery service 520 would be advised to print the screen containing themoney card number 208 (FIG. 2B) and remaining credit balance for thecustomer 302 in a receipt 622, if the delivery service equipment has thecapability. Otherwise, the customer 302 would be advised to write downthe money card number and remaining balance for his records. The moneycard 100 is also returned to the customer 302. If the customer 302refuses the goods 614, the delivery service 520 would send a message(not shown) to the clearinghouse 112 indicating to the effect. Theclearinghouse 112 would unblock the customer's funds, except for therestocking fee and informs the merchant 502 that the goods 614 have beenrefused and credits the merchant's account with the restocking fee. Aswill be described in reference to FIG. 7, if the customer 302 shouldlose the information which contains his money card number 208 (FIG. 2B)and credit balance, he would call the clearinghouse's telephone number,which may be a toll free number, that would appear on the money card 100or he could visit their website and get his remaining balance byentering each money card number(s) 208 (FIG. 2B) and correspondingPIN(s).

The most secure way for a customer 302 to pay his bills/fees/fines orany purchase or transaction with a money card 100, would be for thecustomer 302 to log on to the payee's website and find out the totalamount that he owes. Then, the customer 302 would purchase a money card100 for the EXACT amount and use it only ONCE to pay his balance due.The customer 302 would visit the utility company's or governmentagency's website and when the payment options are displayed, thecustomer 302 would select “Money Card.” The customer 302 would thenenter his money card number(s) 208 (FIG. 2B) and his PIN(s) which wouldbe encrypted and transmitted to the clearinghouse 112 along with theamount due and the utility company or government agency's control oridentification number(s). Because the money card number(s) 208 (FIG. 2B)and PIN(s) would be encrypted, the utility company or government agencywould not know the value of the card(s) and the customer 302 would beprotected from an unscrupulous employee using his remaining creditbalance, if any. When the clearinghouse 112 receives the money cardnumber(s) 208 (FIG. 2B) and PIN(s), it would also receive the dollaramount of the transaction, thus when it releases the funds, it wouldknow how much of the funds to release to the utility company orgovernment agency. Any credit balance remaining to the customer 302would be indicated in a message from the clearinghouse 112. The customer302 would also be advised that the other cards used in the transactionhad exhausted their economic value and were no longer valid. Thecustomer 302 would be advised to print the screen containing his or hermoney card number 208 (FIG. 2B) and remaining credit balance. As will bedescribed in reference to FIG. 7, if the customer 302 should lose theprintout which contains his money card number 208 (FIG. 2B) and creditbalance, he or she would call the clearinghouse's telephone number,which may be a toll free number, that would appear on the money card 100or the customer 302 could visit their website and get his or herremaining balance by entering each money card number(s) 208 (FIG. 2B)and corresponding PIN(s).

A money card 100 would be used as cash or cashed anywhere that aparticipating clearinghouse 112 exists. The customer 302 would send themoney card 100 to someone, then separately, the customer 302 would sendthe PIN or PIC by mail, email or communicate it with a telephone call orany other means of communication the customer 302 chooses. The receivingparty or person in possession of the money card number 208 (FIG. 2B) andPIN would be able to utilize the money card 100 immediately.

FIG. 7 depicts a cardless authentication process in accordance with thepresent invention, which is generally denoted as 700. The customer'sreceipt would have the money card number 208 (FIG. 2B) printed on it andshould the customer 302 (FIGS. 3-6) lose the money card 100, he or shewould still be able to make a purchase as long as the customer 302(FIGS. 3-6) remembers his or her PIN and has his or her receipt. If aPIC or biometric was used to secure the money card, and the money card100 was subsequently lost, the customer 302 (FIGS. 3-6) would go to adispensing agent's location, fill out a lost/stolen information sheet,and provide a PIC or biometric which would be compared to the existingone on file. The customer 302 (FIGS. 3-6) may request the issuance of areplacement money card 100 for a fee. Should the customer 302 (FIGS.3-6) forget his PIN but still possess the money card number, he or shewould go to the clearinghouse's website or call the clearinghouse'stelephone number, which may be a toll free number. If the customer 302(FIGS. 3-6) goes to the website, he or she would click on thelost/stolen money card icon and answer the following questionspertaining to his specific situation.

The cardless authentication process begins in block 702. The customer302 (FIGS. 3-6) is queried as to whether he or she has the vendor'sreceipt in decision block 704. If the answer is yes, the customer 302(FIGS. 3-6) is asked to provide relevant vendor receipt information inblock 706. The vendor receipt information may include:

-   -   1. Country where money card 100 was purchased.    -   2. State where money card 100 was purchased.    -   3. City where money card 100 was purchased.    -   4. Location where money card 100 was purchased, which may be a        street address, shopping center name or a more generalized        location.    -   5. Vendor Name where money card 100 was purchased.    -   6. Exact date when money card 100 was purchased.    -   7. Exact time when money card 100 was purchased.    -   8. Original money card value at the time of purchase.    -   9. Control, transaction, or invoice number.    -   10. Money card number 208 (FIG. 2B).    -   11. Money card 100 currency type.

The number of questions asked will typically depend on the securitylevel assigned to the money card 100 when it was purchased or be basedon the value of the money card 100. After the questions have beenanswered, the clearinghouse 112 verifies the information in block 708and determines whether the process should proceed.

If the customer 302 (FIGS. 3-6) has initiated this process as a cardlesspurchase, as determined in block 710, the customer 302 (FIGS. 3-6) isrequired to provide his or her authentication information (PIN, PIC orbiometric information) in block 716. If the authentication informationis correct, the authentication process is then complete in block 714 andthe transaction is completed as previously described. If, however, thecustomer 302 (FIGS. 3-6) has not initiated this process as a cardlesspurchase and has instead lost his or her PIN, as determined in block710, the clearinghouse 112 provides the PIN to the customer 302 (FIGS.3-6) in block 712. The authentication process is then complete in block714.

If the customer 302 (FIGS. 3-6) does not have the vendor's receipt asdetermined in block 704, the customer is queried as to whether he or shehas used the money card 100 since it was purchased in block 718. If theanswer is no, the customer 302 (FIGS. 3-6) is asked to provide relevantmoney card purchase information in block 720. The money card purchaseinformation may include:

-   -   1. Country where it was purchased.    -   2. State where it was purchased.    -   3. City where money card 100 was purchased.    -   4. Location where money card 100 was purchased, which may be a        street address, shopping center name or a more generalized        location.    -   5. Vendor Name where money card 100 was purchased.    -   6. Date when money card 100 was purchased.    -   7. Approximate time when money card 100 was purchased        (parameters would be provided by the clearing house).    -   8. Original money card 100 value at the time of purchase.    -   9. Money card 100 currency type, such as American or Canadian        dollars, pesos, pounds, yen, marks, francs, euro dollars, etc.

The number of questions asked will typically depend on the securitylevel assigned to the money card 100 when it was purchased or be basedon the value of the money card 100. After the questions have beenanswered, the clearinghouse 112 verifies the information in block 708and determines whether the process should proceed.

If the customer 302 (FIGS. 3-6) has initiated this process as a cardlesspurchase, as determined in block 710, the customer 302 (FIGS. 3-6) isrequired to provide his or her authentication information (PIN, PIC orbiometric information) in block 716. If the authentication informationis correct, the authentication process is then complete in block 714 andthe transaction is completed as previously described. If, however, thecustomer 302 (FIGS. 3-6) has not initiated this process as a cardlesspurchase and has instead lost his or her PIN, as determined in block710, the clearinghouse 112 provides the PIN to the customer 302 (FIGS.3-6) in block 712. The authentication process is then complete in block714.

If the customer 302 (FIGS. 3-6) has used the money card 100 asdetermined in block 718, the customer is queried as to whether he or shehas the previous merchant's receipt in block 722. If the answer is yes,the customer 302 (FIGS. 3-6) is asked to provide relevant merchantreceipt information in block 724. The merchant receipt information mayinclude:

-   -   1. Country where money card 100 was last used. State or province        where money card 100 was last used.    -   2. City where money card 100 was last used.    -   3. Location or website address where money card 100 was last        used.    -   4. Merchant's Name where money card 100 was last used.    -   5. Date when money card 100 was last used.    -   6. Time when money card 100 was last used.    -   7. Original money card value at the time of purchase.    -   8. Control, transaction, or invoice number.

The number of questions asked will typically depend on the securitylevel assigned to the money card when it was purchased or be based onthe value of the money card 100. After the questions have been answered,the clearinghouse 112 verifies the information in block 708 anddetermines whether the process should proceed.

If the customer 302 (FIGS. 3-6) has initiated this process as a cardlesspurchase, as determined in block 710, the customer 302 (FIGS. 3-6) isrequired to provide his or her authentication information (PIN, PIC orbiometric information) in block 716. If the authentication informationis correct, the authentication process is then complete in block 714 andthe transaction is completed as previously described. If, however, thecustomer 302 (FIGS. 3-6) has not initiated this process as a cardlesspurchase and has instead lost his or her PIN, as determined in block710, the clearinghouse 112 provides the PIN to the customer 302 (FIGS.3-6) in block 712. The authentication process is then complete in block714.

If the customer 302 (FIGS. 3-6) does not have the previous merchant'sreceipt as determined in block 722, the customer 302 (FIGS. 3-6) isasked to provide relevant product purchase information in block 726. Theproduct purchase information may include:

-   -   1. Country where money card 100 was last used.    -   2. State or province where money card 100 was last used.    -   3. City where money card 100 was last used.    -   4. Location or website address where money card 100 was last        used.    -   5. Merchant's Name where money card 100 was last used.    -   6. Date when money card 100 was last used.    -   7. Approximate time when money card 100 was last used        (parameters would be provided by the clearinghouse).    -   8. Original money card value at the time of purchase.

The number of questions asked will typically depend on the securitylevel assigned to the money card when it was purchased or be based onthe value of the money card 100. After the questions have been answered,the clearinghouse 112 verifies the information in block 708 anddetermines whether the process should proceed.

If the customer 302 (FIGS. 3-6) has initiated this process as a cardlesspurchase, as determined in block 710, the customer 302 (FIGS. 3-6) isrequired to provide his or her authentication information (PIN, PIC orbiometric information) in block 716. If the authentication informationis correct, the authentication process is then complete in block 714 andthe transaction is completed as previously described. If, however, thecustomer 302 (FIGS. 3-6) has not initiated this process as a cardlesspurchase and has instead lost his or her PIN, as determined in block710, the clearinghouse 112 provides the PIN to the customer 302 (FIGS.3-6) in block 712. The authentication process is then complete in block714.

The clearinghouse 112 may utilize the aforementioned sequence ofquestions, a combination thereof, or any other pertinent data that theclearinghouse 112 deems necessary. These questions should be presentedindividually and in a random order by the clearinghouse 112 to lessenthe likelihood that perpetrators would outguess the system. Theaforementioned questions are just a sampling of what the clearinghouse112 could ask the customer 302 (FIGS. 3-6) who does not have his PIN.Additionally, the clearinghouse 112 should also consider increasing thenumber of questions as the dollar amount of the money card 100increases.

If the money card 100 was secured with a biometric and subsequentlylost, the customer 302 (FIGS. 3-6) would provide the biometric at adispensing agent location 304 (FIG. 3) where the lost money card numberwould be once again revealed to the customer 302 (FIGS. 3-6) for anominal fee.

After answering the sequence of questions, if the information that thecustomer 302 (FIGS. 3-6) provided is correct, his or her card numberwould appear on the screen and he or she could still use his money card100 to make purchases. Should the information provided be incorrect, thecustomer 302 (FIGS. 3-6) would get two more attempts at retrieving hismoney card number 208 (FIG. 2B). After three failed attempts, or anynumber the clearinghouse 112 deems appropriate, the customer 302 (FIGS.3-6) would be informed that the information he or she provided wasinvalid and would be disconnected. At this time, the clearinghouse 112would preclude the customer 302 (FIGS. 3-6) from any further attempts atretrieving the PIN and “red flag” the corresponding money card number onits system. The customer 302 (FIGS. 3-6) would then be advised to visita dispensing agent in person and provide proper identification. If thecustomer 302 (FIGS. 3-6) calls the clearinghouse's telephone number, heor she would have to answer the same information. Money cards wouldexpire twelve (12) months after they had been activated, a time periodspecified in the customer/merchant agreement terms, or a time periodspecified by the law.

FIG. 8 depicts another cardless authentication process in accordancewith the present invention, which is generally denoted as 800. Thecustomer's receipt would have the money card number printed on it andshould the customer 302 (FIGS. 3-6) lose the money card 100, he or shewould still be able to make a purchase as long as the customer 302(FIGS. 3-6) remembers his or her PIN and has his or her receipt. If aPIC or biometric was used to secure the money card 100, and the moneycard 100 was subsequently lost, the customer 302 (FIGS. 3-6) would go toa dispensing agent's location 304 (FIG. 3), fill out a lost/stoleninformation sheet, and provide a PIC or biometric which would becompared to the existing one on file. Should the customer 302 (FIGS.3-6) forget his PIN but still possess the money card number, he or shewould go to the clearinghouse's website or call the clearinghouse'stelephone number, which may be a toll free number. If the customer 302(FIGS. 3-6) goes to the website, he or she would click on thelost/stolen money card icon and answer the following questionspertaining to his specific situation.

The cardless authentication process begins in block 802. The customer302 (FIGS. 3-6) is queried as to whether he or she used the money card100 since it was purchased in block 804. The customer 302 (FIGS. 3-6) isthen queried as to whether he or she has the previous merchant's receiptin block 806. If the customer 302 (FIGS. 3-6) does not have the previousmerchant's receipt as determined in block 806, the customer 302 (FIGS.3-6) is asked to provide relevant product purchase information in block808. The product purchase information may include:

-   -   1. Country where money card 100 was last used.    -   2. State or province where money card 100 was last used.    -   3. City where money card 100 was last used.    -   4. Location or website address where money card 100 was last        used.    -   5. Merchant's Name where money card 100 was last used.    -   6. Date when money card 100 was last used.    -   7. Approximate time when money card 100 was last used        (parameters would be provided by the clearinghouse).    -   8. Original money card value at the time of purchase.

The number of questions asked will typically depend on the securitylevel assigned to the money card when it was purchased or be based onthe value of the money card 100. If, however, the customer 302 (FIGS.3-6) does have the previous merchant's receipt as determined in block806, the customer 302 (FIGS. 3-6) is asked to provide relevant merchantreceipt information in block 810. The merchant receipt information mayinclude:

-   -   1. Country where money card 100 was last used.    -   2. State or province where money card 100 was last used.    -   3. City where money card 100 was last used.    -   4. Location or website address where money card 100 was last        used.    -   5. Merchant's Name where money card 100 was last used.    -   6. Date when money card 100 was last used.    -   7. Time when money card 100 was last used.    -   8. Original money card value at the time of purchase.    -   9. Control, transaction, or invoice number.

The number of questions asked will typically depend on the securitylevel assigned to the money card when it was purchased or be based onthe value of the money card 100.

If the money card 100 has not been used, as determined in block 804, orthe general product purchase information has been properly entered inblock 808, or the exact merchant receipt information has been properlyentered in block 810, the customer is queried as to whether he or shehas the vendor's receipt in block 812. If the answer is yes, thecustomer 302 (FIGS. 3-6) is asked to provide relevant vendor receiptinformation in block 816. The vendor receipt information may include:

-   -   1. Country where money card 100 was purchased.    -   2. State where money card 100 was purchased.    -   3. City where money card 100 was purchased.    -   4. Location where money card 100 was purchased, which may be a        street address, shopping center name or a more generalized        location.    -   5. Vendor Name where money card 100 was purchased.    -   6. Exact date when money card 100 was purchased.    -   7. Exact time when money card 100 was purchased.    -   8. Original money card value at the time of purchase.    -   9. Control, transaction, or invoice number.    -   10. Money card number 208 (FIG. 2B).    -   11. Money card 100 currency type.

The number of questions asked will typically depend on the securitylevel assigned to the money card when it was purchased or be based onthe value of the money card 100.

If the customer 302 (FIGS. 3-6) does not have the vendor's receipt asdetermined in block 812, the customer is asked to provide relevant moneycard purchase information in block 814. The money card purchaseinformation may include:

-   -   1. Country where it was purchased.    -   2. State where it was purchased.    -   3. City where money card 100 was purchased.    -   4. Location where money card 100 was purchased, which may be a        street address, shopping center name or a more generalized        location.    -   5. Vendor Name where money card 100 was purchased.    -   6. Date when money card 100 was purchased.    -   7. Approximate time when money card 100 was purchased        (parameters would be provided by the clearing house).    -   8. Original money card 100 value at the time of purchase.    -   9. Money card 100 currency type, such as American or Canadian        dollars, pesos, pounds, yen, marks, francs, euro dollars, etc.

The number of questions asked will typically depend on the securitylevel assigned to the money card when it was purchased or be based onthe value of the money card 100. After the questions in blocks 814 or816 have been properly answered, the clearinghouse 112 verifies theinformation in block 818 and determines whether the process shouldproceed.

If the customer 302 (FIGS. 3-6) has initiated this process as a cardlesspurchase, as determined in block 820, the customer 302 (FIGS. 3-6) isrequired to provide his or her authentication information (PIN, PIC orbiometric information) in block 824. If the authentication informationis correct, the authentication process is then complete in block 826 andthe transaction is completed as previously described. If, however, thecustomer 302 (FIGS. 3-6) has not initiated this process as a cardlesspurchase and has instead lost his or her PIN, as determined in block820, the clearinghouse 112 provides the PIN to the customer 302 (FIGS.3-6) in block 822. The authentication process is then complete in block826.

The clearinghouse 112 may utilize the aforementioned sequence ofquestions, a combination thereof, or any other pertinent data that theclearinghouse 112 deems necessary. These questions should be presentedindividually and in a random order by the clearinghouse 112 to lessenthe likelihood that perpetrators would outguess the system. Theaforementioned questions are just a sampling of what the clearinghouse112 could ask the customer 302 (FIGS. 3-6) who does not have his PIN.Additionally, the clearinghouse 112 should also consider increasing thenumber of questions as the dollar amount of the money card 100increases.

If the money card 100 was secured with a biometric and subsequentlylost, the customer 302 (FIGS. 3-6) would provide the biometric at adispensing agent location 304 (FIG. 3) where the lost money card numberwould be once again revealed to the customer 302 (FIGS. 3-6) for anominal fee.

After answering the sequence of questions, if the information that thecustomer 302 (FIGS. 3-6) provided is correct, his or her card numberwould appear on the screen and he or she could still use his money card100 to make purchases. Should the information provided be incorrect, thecustomer 302 (FIGS. 3-6) would get two more attempts at retrieving hismoney card number. After three failed attempts, or any number theclearinghouse 112 deems appropriate, the customer 302 (FIGS. 3-6) wouldbe informed that the information he provided was invalid and would bedisconnected. At this time, the clearinghouse 112 would preclude thecustomer 302 (FIGS. 3-6) from any further attempts at retrieving the PINand “red flag” the corresponding money card number on its system. Thecustomer 302 (FIGS. 3-6) would then be advised to visit a dispensingagent in person and provide proper identification. If the customer 302(FIGS. 3-6) calls the clearinghouse's telephone number, he or she wouldhave to answer the same information. Money cards would preferably expiretwelve (12) months after they had been activated, a time periodspecified in the customer/merchant agreement terms, or a time periodspecified by the law.

In certain embodiments, the money card system may utilize an identityverification information feature. This may be the same as or include theauthentication information, such as when biometric data is required forauthentication, so that the proper identity of the user is verifiedduring the authentication. The authentication information may not bepersonalized; however, so that verification of a person's identity isnot included in the authentication information. Thus, a transaction maybe completed by any individual, without identity verification, as longas the PIN, PIC or authentication information is known by theindividual.

A variety of reasons can exist for providing identity verificationinformation with the money card system. The customer may want his or heridentity linked to the money card. The merchant may also want or need toverify the customer's actual identity or other selected individualstatus, such as birth date, residence, citizenship, membership, etc., asa prerequisite to conducting a transaction, or it may be necessitated bylaw.

Reasons for the customer wanting his or her identity linked to the moneycard may be to benefit from promotional incentives, such as rewardpoints for using the money card, or as an added protection feature toprevent the unauthorized use of the money card.

Merchants who deal in goods that cannot be sold to minors, such asalcohol and tobacco, may need to verify the customer's age. Merchants offirearms may want to prevent sales of firearms to convicted felons. Theuse of the money card system with criminal background information maythus eliminate the need for criminal background checks that are commonlyemployed today in such purchases. Additionally, merchants may want tocollect status information on customers for marketing research purposes.Pharmacies may need to verify a person's identity or status todistribute prescription drugs. In these situations, the customer wouldneed to prove his or her actual identity or a selected individual statusat the time the money card is purchased or when the customer purchasesthose goods that require identity verification.

When verification of a customer's identity is required, the customerwould present identification, such as a driver's license, governmentI.D., biometric, matricula consular, passport, or other form of acceptedproof of actual identity or identity status. The identity verificationmay be swiped, scanned, manually entered or a biometric reading could betaken. Because proof of identification is not currently a prerequisitefor purchasing most goods, an additional fee could be charged to thecustomer for adding an identity verification feature on the money card.

The identity verification feature of the money card may be added at thetime that the money card is purchased or afterwards, such as when thecustomer is using the money card to purchase goods or obtain services.Should the customer choose to add the identification verificationfeature at the time of the purchase of the money card, the identityverification feature would be added and sent or transmitted to theclearinghouse. This could be done during the activation request for themoney card or as a separate step. The identity verification informationwould be encrypted when transmitted to the clearinghouse. If a fee ischarged for the identity verification feature, this could be deductedfrom the amount of funds available, for payment to the clearinghouseand/or vendor.

The identity verification information may be required again during themerchant transaction. This provides an added protection to the user forunauthorized use of the money card. In instances where the customer didnot obtain the identity verification during the vending operation, thecustomer may subsequently obtain the identity verification feature.Thus, when the customer discovers that a merchant requires proof ofidentity, he or she may add the identity verification feature to themoney card. As an example, after the customer submits his or her moneycard or money card number and authentication information, they wouldthen validate their identity via a magnetic stripe reader, a UPCscanner, biometric scan or manual entry. The entire information modulewould be encrypted and transmitted to the merchant, which would attachthe sales amount and a merchant control or identification profile to theencrypted file. The entire encrypted transaction would be transmitted tothe clearinghouse during the transaction request. The clearinghouse maycharge a fee to the customer and reduce the credit balance for the moneycard for the identification verification and also for the transactionamount.

In the various embodiments described, revenue can be derived from themoney card system in a variety of manners. A fee for issuance of themoney card or the identity verification may be charged to the customer.Lost or stolen money card recovery fees and reload fees may also becharged to the customer. Other financial benefits may also be derived.These may include the benefit of a float between the vending of themoney card and its use. Advertising revenue and demographics-basedadvertising revenue may also be derived.

Other advantages may also be derived from the money card system.Businesses may now have access to those that typically engage incash-only transactions or that do not possess credit or debit cards. Thecards may be used by individuals that may have significant spendingpower, such as teenagers, but do not have established credit. Those thatmay have credit or debit cards, but do not want to use them because ofidentity theft concerns may also find the money card useful. Themerchant also benefits because they have a quick and reliable transferof funds from the transaction. Online transactions are facilitated toall consumers without discrimination because of their financial statusor credit history. Online transactions may also be carried out thatmight not otherwise be conducted out without the money card.

While specific alternatives to steps of the invention have beendescribed herein, additional alternatives not specifically disclosed butknown in the art are intended to fall within the scope of the invention.Thus, it is understood that other applications of the present inventionwill be apparent to those skilled in the art upon the reading of thedescribed embodiment and a consideration of the appended claims anddrawings.

1. A method of conducting a monetary transaction comprising: providing amoney order device to a customer during a money order device vendingoperation that includes: 1) obtaining a payment of funds andauthentication information provided from a customer at a money orderdevice vendor location; 2) creating an encrypted activation requestcontaining a record of the funds paid, the authentication informationand money order account information; 3) transmitting the encryptedactivation request from the vendor to a remote clearinghouse through avending communication link; 4) creating an account with theclearinghouse for the money order and storing the authenticationinformation, the money order account information and an amount ofaccount funds available based upon the funds paid in a clearinghousedatabase; 5) transmitting an activation response to the vendor; and 6)providing the money order device associated with the created account tothe customer at the vending location; and utilizing the money orderdevice during a merchant transaction operation that includes: 1)providing the money order device to a merchant; 2) creating an encryptedtransaction request that includes money order account information,authentication information provided from the customer and a transactionamount and transmitting via a merchant communication link the requestfrom the merchant to the clearinghouse; 3) determining whether toapprove the transaction by verifying the account information, theauthentication information and transaction amount with money orderaccount information stored in the clearinghouse database, anddetermining whether the transaction amount exceeds the amount of accountfunds available for the money order device; 4) transmitting atransaction response from the clearinghouse of approval or disapprovalof the transaction to the merchant; and 5) upon approval of thetransaction, immediately transferring money order account funds from theclearinghouse to a merchant account of the merchant; and furthercomprising providing identity verification information that istransmitted to the clearinghouse during at least one of the vendingoperation and the merchant transaction operation.
 2. The method of claim1, wherein: the identity verification information is transmitted duringat least one of the transmission of the activation request ortransmission of the transaction request.
 3. The method of claim 1,wherein: the identity verification information is provided only duringthe merchant transaction operation.
 4. The method of claim 1, wherein:the identity verification information is provided only during thevending operation.
 5. The method of claim 1, wherein: the identityverification information is provided in both the vending operation andthe merchant transaction operation.
 6. The method of claim 1, wherein:providing the identity verification information is selected as an optionby the customer during the vending operation.
 7. The method of claim 1,wherein: providing the identity verification information is an optionselected by the merchant during the merchant transaction operation. 8.The method of claim 1, wherein: the identity verification information istransmitted to the clearinghouse during the at least one of theencrypted activation request and the encrypted transaction request. 9.The method of claim 1, wherein: the authentication information includesthe identity verification information.
 10. The method of claim 1,wherein: a fee is charged by at least one of the vendor, merchant orclearinghouse for transmitting or receiving the identity verificationinformation.
 11. The method of claim 1, wherein: the identityverification information includes at least one of a user's actualidentity or a selected status.
 12. A system for providing and utilizinga money order device comprising; a vending unit that creates andtransmits an encrypted activation request containing a record of fundspaid, authentication information from a customer and money order accountinformation and provides a money order device during a money orderdevice vending operation upon a payment of the funds; a vendingcommunication link through which the encrypted activation request istransmitted; a clearinghouse that is remote from the vending unit thatreceives the encrypted activation request through the vendingcommunication link and creates an account for the money order and storesthe authentication information, the money order account information andan amount of account funds available based upon the funds paid in adatabase of the clearinghouse and transmits an activation response tothe vendor unit to allow the vending unit to provide the money orderdevice; a merchant unit that creates an encrypted transaction requestduring a merchant transaction operation, the encrypted transactionrequest including the money order account information, authenticationinformation provided from the customer and a transaction amount; and amerchant communication link for transmitting the request from themerchant unit to the clearinghouse; and wherein the clearinghousedetermines whether to approve the transaction by verifying the accountinformation, the authentication information and transaction amount withmoney order account information stored in the clearinghouse database,and determines whether the transaction amount exceeds the amount ofaccount funds available for the money order, and transmits a transactionresponse to the merchant unit of approval or disapproval of thetransaction and upon approval of the transaction, immediately transfersmoney order account funds from the clearing house to a merchant accountof the merchant; and further comprising providing identity verificationinformation that is transmitted to the clearinghouse during at least oneof the vending operation and the merchant transaction operation.
 13. Thesystem of claim 12, wherein: the identity verification information istransmitted through at least one of the vending communication linkduring transmission of the activation request or the merchantcommunication link during transmission of the transaction request. 14.The system of claim 12, wherein: the identity verification informationis provided only during the merchant transaction operation.
 15. Thesystem of claim 12, wherein: the identity verification information isprovided only during the vending operation.
 16. The method of claim 12,wherein: the system verification information is provided in both thevending operation and the merchant transaction operation.
 17. The systemof claim 12, wherein: providing the identity verification information isselected as an option by the customer during the vending operation. 18.The system of claim 12, wherein: providing the identity verificationinformation is an option selected by the merchant during the merchanttransaction operation.
 19. The system of claim 12, wherein: theauthentication information includes the identity verificationinformation.
 20. The system of claim 12, wherein: the identityverification information includes at least one of a user's actualidentity or a selected status.